Weak demand has begun pushing steel prices down after they climbed to a seven-month high in March.
Leading steel manufacturer Hoa Phat Group has accordingly lowered its rebar steel price by 0.63% to VND15.89 million ($677.55) per ton.
It also brought the price of wire rod steel price down 1.88% to VND15.66 million per ton.
Viet Y Steel lowered its product prices by the same rate to VND15.86 million for rebar steel and 15.61 million for wire rod steel.
The decline now has steel prices down from their seven-month peak recorded at the end of March. Prices had been rising since last year.
Hoa Phat reported that the lower prices reflect a decline in material costs, while Viet Y said that the adjustment was made according to market fluctuations.
Steel products sales in the first two months of 2023 plunged 23% year-on-year to 3.8 million tons, while exports dropped 10% to 1 million tons, according to the Vietnam Steel Association.
Hoa Phat, which accounts for 40% of the segment’s market share, recorded a sales drop of 34% in the first two months.
Sales at distributor Steel Online plunged 30% year-on-year through March.
Bui Duy Anh, deputy director of the company, told VnExpress that prices will likely drop further as demand remains low with consumers cutting spending amid ongoing inflation.
He added that not enough public projects are being developed to significantly boost demand.
However, not everything is pessimistic.
“The drop, however, will have its benefits, as it will bring down costs of public infrastructure projects and urge steelmakers to find more buyers overseas,” he said.
At the same time, the Vietnam Steel Association has reported that it expects the market to begin recovering in the third quarter of this year at the earliest.
Brokerage VNDirect has reported it also agrees that steel consumption will likely start to rise in the third quarter.
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